NUI Maynooth Talk 7th Nov 2008

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NUI Maynooth Talk 7th Nov 2008

  1. 1. Computable and Experimental Economics at the University of Limerick Stephen Kinsella Dept. Economics, University of Limerick. stephen.kinsella@ul.ie www.stephenkinsella.net November 5, 2008 Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 1 / 14
  2. 2. Today 1 Computable Economics 2 Experimental Economics 3 iCEEL 4 An Experiment Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 2 / 14
  3. 3. By way of a preamble. . . But I believe that there is no philosophical highroad in science, with epistemological signposts. . . we are in a jungle and find our way out by trial and error, building our road behind us as we proceed. We do not find signposts at crossroads, but our scouts erect them, to help the rest. ––Max Born, Experiment and Theory in Physics (1943) Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 3 / 14
  4. 4. What is Computable Economics? we, as economic theorists, tend to ‘formulate the questions’ in the language of a mathematics that the digital computer does not understand—classical real analysis—but ‘get together the data’ that it does, because the natural form in which economic data appear is in terms of integer, natural or rational numbers. The transition between the two domains remains a proverbial black box. . . –(3, pg. 4) Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 4 / 14
  5. 5. An Example Intermediate Value Theorem Theorem (Intermediate Value Theorem) Let f : R −→ R be a continuous function from the closed interval [a, b] to R and let f (a) < 0 and f (b) > 0. Then ∃x ∈ R and a < x < b such that f (x) = 0. Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 5 / 14
  6. 6. Figure: Example of a fixed point. Intermediate Value Theorem underpins fixed point theorems, which underpin general equilbrium theory. Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 6 / 14
  7. 7. An Example Constructive Intermediate Value Theorem Theorem (Constructive Intermediate Value Theorem) Let f : R −→ R be a continuous function, from [a, b] ∈ R to R, and let f (a) < 0, f (b) > 0; then ∀ > 0, ∃x ∈ R such that a < x < b subject to |f (x)| < . Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 7 / 14
  8. 8. So What? Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 8 / 14
  9. 9. Definitions & Pioneers Defined as the use of experimental methods to evaluate theoretical predictions of economic behaviour (1). Uses controlled, scientifically designed experiments to test economic theories under laboratory conditions. Pioneered by Smith (1962), Kahenman & Tversky (1979) Modern variants: Behavioural game theory, neuroeconomics, field experiments, computable experimental economics Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 9 / 14
  10. 10. Definitions & Pioneers Defined as the use of experimental methods to evaluate theoretical predictions of economic behaviour (1). Uses controlled, scientifically designed experiments to test economic theories under laboratory conditions. Pioneered by Smith (1962), Kahenman & Tversky (1979) Modern variants: Behavioural game theory, neuroeconomics, field experiments, computable experimental economics Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 9 / 14
  11. 11. Definitions & Pioneers Defined as the use of experimental methods to evaluate theoretical predictions of economic behaviour (1). Uses controlled, scientifically designed experiments to test economic theories under laboratory conditions. Pioneered by Smith (1962), Kahenman & Tversky (1979) Modern variants: Behavioural game theory, neuroeconomics, field experiments, computable experimental economics Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 9 / 14
  12. 12. Definitions & Pioneers Defined as the use of experimental methods to evaluate theoretical predictions of economic behaviour (1). Uses controlled, scientifically designed experiments to test economic theories under laboratory conditions. Pioneered by Smith (1962), Kahenman & Tversky (1979) Modern variants: Behavioural game theory, neuroeconomics, field experiments, computable experimental economics Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 9 / 14
  13. 13. Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 10 / 14
  14. 14. iCEEL New Lab, New KBS 20 Computers, proper partitions, servers, software, etc Mobile Lab (20 Laptops) Trading Simulation Floor Jan 2009 Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 11 / 14
  15. 15. iCEEL New Lab, New KBS 20 Computers, proper partitions, servers, software, etc Mobile Lab (20 Laptops) Trading Simulation Floor Jan 2009 Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 11 / 14
  16. 16. iCEEL New Lab, New KBS 20 Computers, proper partitions, servers, software, etc Mobile Lab (20 Laptops) Trading Simulation Floor Jan 2009 Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 11 / 14
  17. 17. iCEEL New Lab, New KBS 20 Computers, proper partitions, servers, software, etc Mobile Lab (20 Laptops) Trading Simulation Floor Jan 2009 Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 11 / 14
  18. 18. iCEEL New Lab, New KBS 20 Computers, proper partitions, servers, software, etc Mobile Lab (20 Laptops) Trading Simulation Floor Jan 2009 Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 11 / 14
  19. 19. Social aspects of risky investments 4 ‘trustees’, 1 ‘trustor’ interact in an experimental environment We alter access to trustees, & change participant’s information levels with regard to the trustworthiness of these trustees We think as we increase information about principal to agent, trust, and risky behaviour alters (author?) (2) Obvious real world applications Extra dimension: culture Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 12 / 14
  20. 20. Social aspects of risky investments 4 ‘trustees’, 1 ‘trustor’ interact in an experimental environment We alter access to trustees, & change participant’s information levels with regard to the trustworthiness of these trustees We think as we increase information about principal to agent, trust, and risky behaviour alters (author?) (2) Obvious real world applications Extra dimension: culture Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 12 / 14
  21. 21. Social aspects of risky investments 4 ‘trustees’, 1 ‘trustor’ interact in an experimental environment We alter access to trustees, & change participant’s information levels with regard to the trustworthiness of these trustees We think as we increase information about principal to agent, trust, and risky behaviour alters (author?) (2) Obvious real world applications Extra dimension: culture Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 12 / 14
  22. 22. Social aspects of risky investments 4 ‘trustees’, 1 ‘trustor’ interact in an experimental environment We alter access to trustees, & change participant’s information levels with regard to the trustworthiness of these trustees We think as we increase information about principal to agent, trust, and risky behaviour alters (author?) (2) Obvious real world applications Extra dimension: culture Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 12 / 14
  23. 23. Social aspects of risky investments 4 ‘trustees’, 1 ‘trustor’ interact in an experimental environment We alter access to trustees, & change participant’s information levels with regard to the trustworthiness of these trustees We think as we increase information about principal to agent, trust, and risky behaviour alters (author?) (2) Obvious real world applications Extra dimension: culture Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 12 / 14
  24. 24. Collaboration! Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 13 / 14
  25. 25. References [1] John H. Kagel and Alvin E. Roth. Handbook of Experimental Economics. Princeton University Press, New Jersey, USA, 1997. [2] A. R. Soetevent. Empirics of the identification of social interactions: An evaluation of the approaches and their results. Journal of Economic Surveys, 20(2):193–228, 2006. [3] K. V. Velupillai. Computability, Complexity and Constructivity in Economic Analysis. Blackwell Publishing, 2005. Stephen Kinsella (UL) Computable and Experimental Economics November 5, 2008 14 / 14

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